MITCHELL LATTOF | January 7, 2021 | Personal Injury
Legal representation shouldn’t be reserved solely for dramatic situations worthy of their own HBO miniseries. It’s very possible that you will find yourself in need of legal representation at some point in your life. Car accidents, divorce negotiations, traffic violations, estate planning, slip & fall injuries, company mergers, and wrongful termination are just a few common situations that call for the help of a law expert.
Unfortunately, people sometimes forgo seeking counsel with the assumption that the cost of representation far outweighs the payoff. In many cases, especially with personal injury law, it’s just the opposite.
Before writing lawyers off as out of your budget, you should understand how legal fees work—here’s everything you need to know before deciding if getting a lawyer’s help makes financial sense.
Most Lawyers Offer Initial Consultations for Free
First things first: It never hurts to get in touch with a lawyer, even if you’re on a tight budget. Many people steer clear of lawyers altogether out of fear that they’ll be billed for simply reaching out. Lawyers aren’t like doctors—you generally won’t be billed for stopping in to ask a few questions.
Initial consultations with lawyers are usually free, allowing you to get basic questions out of the way before committing to payment. During a consultation, the cards are in your hands. You will explain your situation to the lawyer, and they will determine whether or not they are able to help. If they believe that legal representation will get you better results, they’ll explain what they can do and will go over the potential costs involved.
The goal of a consultation is to determine if it makes sense for you and the lawyer to join forces. They’re pitching their services to you, and it’s up to you whether or not you’d like to proceed.
Occasionally, you’ll come across lawyers who charge for initial consultations to make sure that they’re compensated for their time and expertise, but most lawyers understand that it’s better for business to get you in the door with no strings attached and only worry about payment if the client wants to move forward. To avoid surprise fees, double-check the lawyer’s website before you schedule to make sure initial consultations are free.
Charges Depend on the Type of Lawyer You Need
After a consultation, the real work begins, but there’s no one-size-fits-all approach to payment. Different types of lawyers will have different methods of charging—and different rates. To get an idea of what you might be charged, you should first determine what kind of legal help you need.
There are several areas of law, and lawyers generally have a specialty. You wouldn’t ask a brain surgeon to fix a cavity. In the same way, you wouldn’t ask a bankruptcy attorney to help bring negligence claims. Here are some of the most common types of law and examples of what they cover:
- Personal Injury (e.g., automotive accidents, workers’ compensation, defective product cases, medical malpractice)
- Family (e.g., prenuptial agreements, divorce settlements, child support & custody, adoption)
- Employment (e.g., workplace discrimination, wrongful termination, sexual harassment, retaliation)
- Civil Litigation (e.g., class action lawsuits, property disputes, contract disputes)
- Immigration (e.g., visas, green cards, citizenship & naturalization, deportation, employment for non-citizens)
- Criminal (e.g., criminal trials, arraignment, arrest, bail)
- Corporate (e.g., incorporating a business, mergers, acquisitions, compliance)
- Bankruptcy (e.g., foreclosure, debt)
- Intellectual Property (e.g., copyrights, trademarks, patents)
- Trusts & Estates (e.g., wills, estate planning)
Of course, this is only the beginning. If your legal issue doesn’t fall into one of these categories, you can almost certainly find someone with the expertise to assist.
The Three Most Common Lawyer Fees
When you decide to hire a lawyer, you’ll have to come to an agreement on the terms of the partnership, including the lawyer’s duties and the client’s payment plan. Lawyers generally propose one of three legal fee arrangements:
Maybe you’ve heard that personal injury lawyers are some of the most affordable—that’s because they generally work on contingency, similar to how a salesperson might work on commission. When a client agrees to pay a contingency fee, they are saying their payment is contingent on the lawyer’s success. If the lawyer is able to get them money, then the client will pay the lawyer a portion of the earnings.
Contingency fees are represented in percentages. Most lawyers agree to represent a client for about a third of the cut, but exact rates vary from lawyer to lawyer and case to case. Whatever the percentage, clients can agree to a contingency fee knowing that they aren’t going to lose any money.
The worst-case scenario with a contingency fee arrangement is that you walk away with the same amount of money you started with—though it’s in the lawyer’s best interest to keep that from happening.
Hourly fee arrangements aren’t ideal for the client—especially one who is hoping to cut costs—yet some lawyers still roll with it. An hourly fee is exactly how it sounds: The lawyer charges by the hour. As you can imagine, this adds up fast.
Often, the client will pay a retainer fee up front, which is a large chunk of money paid in advance that will sit in a special account for the duration of the contract. Rather than billing the client directly for hours worked, the lawyer will withdraw money from this account to cover their services. At the end of the project, if there’s any money left over in the account, it will be refunded to the client.
With a flat fee agreement, the client pays a fixed amount up front to cover the lawyer’s services. It’s more predictable than an hourly fee agreement, but not always less expensive.
Generally, lawyers only charge flat fees when they agree to take on a simple or predictable case. That’s because they know exactly how long the project will take and can charge the client accordingly. Flat fees are commonly charged for routine procedures like drafting a will, filing an uncontested divorce, evicting a tenant, or challenging a traffic ticket.
Why Lawyers Are Worth the Cost
It’s true that finding legal representation often results in paying a fee, but it’s far more costly to go it alone. Lawyers ensure that a defendant gets the maximum payout possible that is owed to them by law.
A survey by legal encyclopedia Nolo found that people who hired a personal injury lawyer received an average payout of $77,600, compared to $17,600 for those who didn’t acquire legal representation.
Personal injury lawyers that charge fairly are worth every penny because they only get paid if you get paid. And they’ll do everything they can to make sure you get paid.